The Securities and Exchange Commission (SEC) is asking for public comments on the continuation of a rule under the Paperwork Reduction Act. This rule relates to how certain broker-dealers, called OTC derivatives dealers, calculate their financial risks. Currently, two such dealers use this method, spending about 1,000 hours each year reporting on their risk models. The SEC invites comments on whether the rule is useful, the burden it imposes, and ways to improve information collection.
Simple Explanation
The SEC wants to know what people think about a rule that helps some special finance companies, called OTC derivatives dealers, figure out their money risks. Only two companies do this now, and it takes them a lot of time, 1,000 hours each year, to report what they find.